Does anyone in invest or art.
I have known people invest in wine to mixed results.
The idea in investing in art appeals to me. I wonder if they are an easy ways to invest and if anyone has done it.
Thanks kind regards, Ben.
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Iâm absolutely sure I would have negative ROI. And a lovely meal
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Many years ago I tried investing in art, I bought some limited signed prints by Rolf Harris.
I donât invest in art anymore.
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In terms of investing outright I donât really know, but there is an app called Saatchi Art that helps you find art⌠kind of the same?
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If you buy prints, buy them because you like them, not because you see them as an investment.
In fact, the same could probably apply to the art you do hope will give you a return later down the line - buy art you like, so youâre not too upset if youâre left holding something.
As far as other things to think about go, it took a few days but I was eventually able to find a Guardian article I remembered reading about buying artwork from graduation shows.
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Thank you, that is a very interesting article from the Guardian.
Some of the increases in value for art in that article are mind boggling.
I actually have a original photo print of Lance Armstrong, being a bit of a sport nut.
Doubt the is any value in it anymore. But I am rather fond of alternative investments and ideas it appeals to my personality.
One of the core rules of buying shares is âdonât get emotionally attached to a companyâ.
Yet when people talk of investing in art (or wine etc.) I hear the phrase âbuy what you like because at least you wonât be upset if it doesnât go wellâ.
Thatâs not investing, thatâs collecting. Donât invest in art that you like, invest in art you think is going to give you a good return. And if it doesnât give a good return cut your losses, just like you would with a stock holding.
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Mental note for future self
Step 1
Invest in wine. As many bottles as possible
Step 2
Drink it at your own leisure
Step 3
Use the bottles to make an installation
Step 4
Sell it
Step 5
Rinse and repeat
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One of the core rules of buying shares is âdo your research, and if you have particular knowledge of an area that would help, make use of it.â
I would argue thatâs the better analogy for âbuy art you likeâ in this case. Youâre making use of your art knowledge. If itâs something you like, then unless your tastes are severely out of whack, thereâll be a market for it somewhere - and you may well know where to find it.
And I absolutely allow for a degree of being upset if it doesnât pan out - your paraphrasing of what I said is a misrepresentation. I mean, you yourself say âAnd if it doesnât give a good return cut your lossesâ, which is not at all different from what I said, other than itâs a little easier to cope with the cutting of the losses when you know youâve at least got some appreciation for it.
Is that more collecting than investing? Thatâs a fair enough comment. I would say you have to - on some level - be a collector first before an investor, because otherwise you wonât have the knowledge to judge the market and make good decisions.
Iâve known people - multiple people - own art they thought was dogshit but purchased because they also thought there would be a market for it. Only to find they couldnât sell it because i actually was dogshit. This would be where buying what you like - or buying what you know - has an advantage.
Perhaps another way of putting it, that threads a line between what Iâve said I what youâve said and draws the two sides together, would be:
Like any investment, do your own research.
(Which is to say, thereâs a world of difference between thinking âThis is dogshit but somebody might like it and I wouldnât want to miss an opportunityâ, and âThis is dosgshit but itâs dogshit I know thereâs a market for and that I can capitlise onâ)
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Might be worth looking at something like Feral Horses* where you can buy shares in art. Their current investable art projects are
They had a interesting campaign recently of Habemus Hominem by Jago which is bust of Pope Benedict XVI which now trading +38% on their secondary market. Most of the other artworks on their secondary market are flat, or have depreciated.
*Referral link. You can bypass this by clicking here. To be honest their referral program isnât very enticing.
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"Francis I of France paid 4,000 ecus in 1540 for Leonardo da Vinciâs Mona Lisa. On the off chance that a few of you have not kept track of the fluctuations of the ecu 4,000 converted out to about $20,000.
"If Francis had kept his feet on the ground and he (and his trustees) had been able to find a 6% after-tax investment, the estate now would be worth something over $1,000,000,000,000,000.00. Thatâs $1 quadrillion or over 3,000 times the present national debt, all from 6%. I trust this will end all discussion in our household about any purchase or paintings qualifying as an investment.
âHowever, as I pointed out last year, there are other morals to be drawn here. One is the wisdom of living a long time. The other impressive factor is the swing produced by relatively small changes in the rate of compound.â
Warren Buffett, âOur Performance in 1963â, p. 4-5, 18-1-1964
http://web.archive.org/web/20140929092338/http://rbcpa.com/WEB_letters/1964.01.18.pdf
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Art is fascinating, especially how paintings are authenticated, valued etc. For a interesting read check out the history of some of Da Vinciâs paintings, maybe start with Salvator Mundi which is the most expensive painting to ever sell at auction. Yet thereâs doubt amongst art experts about whether this is the âofficialâ one by Da Vinci. Thereâs also a few different versions of Mona Lisa, from what I recall he never did complete the Mona Lisa, it was something he was constantly working on.
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These kind of statements are meaningless. how can you get 6% on an amount that no one in the world can afford 6% of? that would only be possible with hyperinflation
That is absolutely brilliant, exactly the type of thing I was looking for.
This forum really is great, I am not logged in a lot of the times I am reading on here but I learn something every time. Great to get ideas and links of knowledgeable people.
Thank you for the link.
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I found this quite interesting as I am an artist and an Art teacher. If you are going to invest in any art I would ensure the name is already collected or in ascendancy. Your best bet is to investigate galleries that represent artists. Looking at the post relating to the horse site I was a little bit dubious as its not like buying a horse it is actually buying art and it wonât sell on that often. I would also investigate art car boot sales and these kind of markets as you will pick up value there.
Itâs an interesting concept buying shares in a picture. I would be more than happy of course for you to buy my work 
or shares in it
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I pretty much doubt it would be possible at all. How much are we talking about?! 6% of $1 quadrillion?! Thatâs $60 trillion. In 1964.
If we use this online calculator
We get $495,760,645,161,290.25. $495 trillion. I donât think that can be achieved either. But that besides the point.
The point is:
Time in the market + magic of compounding = stellar, incomprehensible returns
Vs
âInvestingâ in art
One can argue art has value beyond the economic and financial realms. I agree with that view. But that misses the point. The author was selected by its partners to deliver economic and financial returns to them. And in order to achieve it, the author considers paintings to be of no use. Why? Because he believes he can achieve better than 6% after taxes. Has he?!
One can also argue that long before getting to the $1 quadrillion mark, the sensible investor would increasingly find himself being unable to find investable assets that would produce 6% after taxes. He would then start hoarding in the hopes for better days to deploy his minions and would start financing charities?! Has he?!
Mayhaps if I quote a bit more text things get easier to grasp?!
âThe Joys of Compounding
"Now to the pulse-quickening portion of our essay. Last year, in order to drive home the point on compounding, I took a pot shot at Queen Isabella and her financial advisors. You will remember they were euchred into such an obviously low-compound situation as the discovery of a new hemisphere.
âSince the whole subject of compounding has such a crass ring to it, I will attempt to introduce a little class into this discussion by turning to the art world. Francis I of France paid 4,000 ecus in 1540 for Leonardo da Vinciâs Mona Lisa. On the off chance that a few of you have not kept track of the fluctuations of the ecu 4,000 converted out to about $20,000.
âIf Francis had kept his feet on the ground and he (and his trustees) had been able to find a 6% after-tax investment, the estate now would be worth something over $1,000,000,000,000,000.00. Thatâs $1 quadrillion or over 3,000 times the present national debt, all from 6%. I trust this will end all discussion in our household about any purchase or paintings qualifying as an investment.
âHowever, as I pointed out last year, there are other morals to be drawn here. One is the wisdom of living a long time. The other impressive factor is the swing produced by relatively small changes in the rate of compound.
âBelow are shown the gains from $100,000 compounded at various rates:
| 4% | 8% | 12% | 16% | |
|---|---|---|---|---|
| 10 Years | $48,024 | $115,892 | $210,584 | $341,143 |
| 20 Years | $119,111 | $366,094 | $864,627 | $1,846,060 |
| 30 Years | $224,337 | $906,260 | $2,895,970 | $8,484,940 |
âIt is obvious that a variation of merely a few percentage points has an enormous effect on the success of a compounding (investment) program. It is also obvious that this effect mushrooms as the period lengthens. If, over a meaningful period of time, Buffett Partnership can achieve an edge of even a modest number of percentage points over the major investment media, its function will be fulfilled.
âSome of you may be downcast because I have not included in the above table the rate of 22.3% mentioned on page 3. This rate, of course, is before income taxes which are paid directly by you -not the Partnership. Even excluding this factor, such a calculation would only prove the absurdity of the idea of compounding at very high rates - even with initially modest sums. My opinion is that the Dow is quite unlikely to compound for any important length of time at the rate it has during the past seven years and, as mentioned earlier, I believe our margin over the Dow cannot be maintained at its level to date. The product of these assumptions would be a materially lower average rate of compound for BPL in the future than the rate achieved to date. Injecting a minus 30% year (which is going to happen from time to time) into our tabulation of actual results to date, with, say, a corresponding minus 40% for the Dow brings both the figures on the Dow and BPL more in line with longer range possibilities. As the compounding table above suggests, such a lowered rate can still provide highly satisfactory long term investment results.â
Warren Buffet, âOur Performance in 1963", p. 4-5, 18-1-1964.
Full letter in the link below
Successful artists are business people. I see investing in art more like activist investing â get to know the artist and their approach to the business of art. How prolific are they? How do they market themselves? Number of followers / engagement? Where is their audience? Who is on their team?
Investing in art is very different to investing in stocks. You do need a curator / collector mentality. I do only buy what I like. I only buy originals or first edition prints.
But I donât do it for the return. I do it because I love art and I have wall space. I just target my purchases carefully.
Of course it doesnât compound in the same way so the chance of a big return is way less likely.
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Identifying good art is easy: all you have to do is look at a million pictures. Whether the good art will appreciate in value is a different question. Salute to the art collectors.
Feral Horses now have a Banksy.
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